Insurance and Real Estate Committee

JOINT FAVORABLE REPORT

Bill No.:

SB-813

Title:

AN ACT ESTABLISHING A TAX CREDIT FOR THE PURCHASE OF LONG-TERM CARE INSURANCE.

Vote Date:

2/14/2013

Vote Action:

Joint Favorable

PH Date:

2/5/2013

File No.:

SPONSORS OF BILL:

Insurance and Real Estate Committee

REASONS FOR BILL:

The bill will establish a state income tax credit of $500 for the purchase of long-term care insurance.

RESPONSE FROM ADMINISTRATION/AGENCY:

Deb Migneault, Legislative Commission on Aging, submitted written testimony in support of the bill stating “It is in the state's best interest to encourage residents to plan for their long-term services and supports (LTSS) needs. Long-term care insurance policies are an effective and important way for some older adults” to do so, and that these policies “allow people to receive services and supports in the environment of their choice and protect them from spending all of their assets in order to qualify for Medicaid.” She also stated that one third of Connecticut residents have no plan for their LTSS needs. In addition, over fifty percent of people over age 60 erroneously believe that Medicare will pay for LTSS care. She stated that the lack of Medicare and private health insurance coverage for LTSS creates too much reliance on Medicaid. She concluded her testimony by stating “The state should make every effort to balance the ratio of public and private resources on LTSS. Creating tax incentives like the one proposed in this bill may help to do this.”

NATURE AND SOURCES OF SUPPORT:

Susan Giacalone on behalf of the Insurance Association of Connecticut, testified in support of the bill stating “The current system for financing long-term care is expensive and fragmented. More times than not, the financial responsibility for long-term care falls to the state. Medicaid is one of the biggest tickets on the government's budget. Last year, the state spent 2.8 billion or about 10 percent of the state budget on long-term Medicaid services. One way to help offset that is to encourage individuals to purchase a product through an incentive such as this to help on the long-term, decrease that cost. It's projected that those costs will increase by 360 percent by the year 2030.”

NATURE AND SOURCES OF OPPOSITION:

No testimony in opposition to the bill was received.

Reported by: Sheila McCreven

Date: March 4, 2013